Allocation of 12 mmscmd of RIL gas to NTPC: Petroleum ministry provides its own spin

While the Solicitor General of India and the power ministry had pitched in with a recommendation for allocation of 12 mmscmd of gas to NTPC, the petroleum ministry, which, as the secretariat of the EGOM, put forward the following background brief on the matter to the EGOM:

 Implications of the judgment on NTPC matter:

 MoP has requested that EGOM should consider the proposal for allocation of 12 mmscmd gas to NTPC at discovered ICB price of US$2.34/mmbtu without waiting for outcome of pending NTPC suit in High Court of Mumbai. Proposal is for supply of gas to NTPC`s proposed Kawas & Gandhar expansion projects having capacity of 2600 MW.

 The Supreme Court has held that "it is to be noted that the price determined by the Government is not the subject matter of either the Company Application nor is it an issue which arises out of the impugned judgment. There is no duly constituted proceedings where any challenge has been laid to Government Policy, price, fixation, grant or refusal of approval. Further, without such proceeding in existence and without NTPC being a party in present proceedings, any issue touching upon the validity of price fixation or price formula does not arise."

 Decisions on NTPC matter in earlier EGOM meetings

 Meeting on October 23, 2008: Regarding NTPC-RIL sale price, views expressed by Law Minister were noted. It was decided that verdict of the court should be awaited.

 January 8, 2009: "Supply of natural gas to various upcoming/proposed power plants, including inter alia Dadri Power Project: Requirement for these plants was considered. EGOM noted that several power projects including Dadri Power Project are in pipeline after receiving necessary clearance and permission. Referring to decision taken at meeting on 23.10.2008 (para 2D), EGOM decided that subject to availability of gas, necessary allocations from RIL KG D6 fields will be made to these projects in pipeline including Dadri Power Project as and when they are ready to commence production. This will be without prejudice to decisions of Court cases."